White House Rebuffed VA's Pleas for More Money, Principi Testifies

For Immediate Release:

February 4, 2004

Contact:Niels C. Sorrells and Martha Angle

CQ Staff

The Department of Veterans Affairs received $1.2 billion less than it requested from the White House when President Bush's fiscal 2005 budget was assembled, Secretary Anthony J. Principi told lawmakers Wednesday.

The revelation during the House Veterans' Affairs Committee's first hearing on the budget reaffirmed the view of many legislators that the administration has underfunded veterans programs in its budget.

Democrats lashed out, charging that the administration is shortchanging those who have served their country. Republicans, while more understated, vowed that Congress will add money to the VA budget, especially for veterans' medical care.

"Congress will have to add funds in the budget," said committee Chairman Christopher H. Smith, R-N.J. "Something we have done in four of the past five years."

The administration has requested $29.7 billion in discretionary spending for the VA in fiscal 2005. Of that, about $29.5 billion, including $2.4 billion in anticipated collections of fees and insurance reimbursements, would be for health care programs.

Principi's admission of the $1.2 billion shortfall stunned many veterans groups and staff aides, who say that legislators routinely ask how much the department has sought from the White House Office of Management and Budget, but rarely get a straight answer.

Democrats argued that, had the VA received the $1.2 billion, health care resources in the VA budget would keep pace with medical inflation. Some argued that even more would be necessary since Congress is likely to reject administration proposals that would levy additional fees for access to VA health care on some veterans who seek health care for problems not related to their military service.

Congress last year refused to impose enrollment fees or to boost prescription drug co-payments for veterans. "I can't believe the administration would come back and battle again on these co-payments after we said we're not going to do it," said Rep. Ciro D. Rodriguez, D-Texas.

Last year, Bush proposed to charge a $250 fee to all veterans in priority groups 7 and 8 when they first sought to enroll in the VA's medical system. Veterans in those groups have health problems not incurred while they were in the military and have annual incomes of at least $24,600. For the coming year, the Bush budget proposes charging the $250 only when a veteran first uses VA medical care, not upon initial enrollment.

The fiscal 2005 budget also would boost prescription drug co-payments from $7 to $15 per prescription for the same priority 7 and 8 veterans.

Under questioning from Smith, Principi acknowledged that the user fee and increased drug co-payments "may discourage some use by veterans 7 and 8 who have other options. I don't believe it will discourage people with no other options."

Principi said if Congress again refuses to approve the new fees and co-payments proposed in the president's budget, it will either have to appropriate more than Bush has asked or veterans will face "longer waiting lines" and the VA will have to make "more difficult enrollment decisions."